Victoria job cuts: In the land of public servants, politicians institute a modest cull to save themselves

Over the past decade of Labor rule in Victoria, there has been no greater beneficiary than the public service. On Thursday, to save their own jobs, the politicians atop the government promised a modest trim.

Premier Jacinta Allan and Treasurer Jaclyn Symes promised to cut about 1000 jobs, which is 0.3 per cent of the 382,823 people employed in the public service at the end of the 2024 financial year, the latest count from the Victorian Public Sector Commission.

The spending reductions will save roughly $4 billion, the government asserts, savings forced on the government by what academic economist Gigi Foster recently described as the “precipice of a fiscal crisis”.

While covering the private school fees of many senior public servants, unrestrained spending has left the second most-populous state in financial distress. Debt has grown 415 per cent since 2014, while the economy expanded 29 per cent.

“The Victorian government faces serious questions about its economic future,” Professor Foster wrote on November 25.

The inevitable cost of state debt is higher taxes. Unlike her predecessor, Victoria’s new opposition leader, Jess Wilson, is economically articulate. Her campaign to win power at next year’s election is based on warning voters about the state’s finances.

‘Disproportionate growth’

Which makes its surprising that Ms Allan and Ms Symes did not decide to cut harder in response to a review conducted by Helen Silver, a former head of the Victorian public service and now the number-two at Allianz Australia, an insurer.

Ms Silver calculates the number of top executives and highly paid professionals has increased by 82 per cent over the past six years.

“There has been disproportionate growth in staffing in public sector entities and VPS and non-departmental entities over the past five years,” Ms Silver’s report said.

Ms Silver told the government in June 2000 jobs should go. She also went after over-the-top services, including underutilised doctors in high schools, lavish spending on school musical instruments and the construction of kindergartens, which the private sector is happy to do.

Sprawling bureaucracy

The rejection of these sensible-but-modest suggestions demonstrates how deeply Victorian society has been captured by a public service culture.

Ministers have allowed a sprawling bureaucracy to expand across the state. More than 500 public entities exist alongside 3400 boards and committees that generate income for public servants or functionaries with government connections.

Victoria has a regulator covering meat, poultry, and seafood, one for dairy products and another to food licensing and safety. Wage Inspectorate Victoria is independent of the Portable Long Service Authority and the Labour Hire Authority.

Parks Victoria competes with the the Conservation Regulator, as does the Heritage Council of Victoria with Heritage Victoria. Victorian Fisheries Authority and Game Management Authority both regulate natural resources. Racing Victoria, Greyhound Racing Victoria and Harness Racing Victoria compete for punters.

Ms Silver wants 78 agencies done away away with, including the Local Jobs First Commissioner, Sustainability Victoria, Better Regulation Victoria and Launch Vic.

Chainsaws or pocket knives

Ms Allan and Ms Symes agreed to cut 29 agencies, suggesting they do not accept government is strangling the Victorian economy, which has the highest unemployment and the second-weakest economic growth in the nation.

The ministers made it sound like they were wielding chainsaws rather than pocket knives. The public service “has become top-heavy,” Ms Symes said. “We have too many executives, too many in the top of the range and not enough entry-level and graduate positions.”

A more honest assessment might have been that Victoria has a committee for almost every interest group, a system that placates and rewards anyone who might consider criticising the government.

A list of 90 advisory committees identified by the review included the Victorian Broiler Industry Negotiation Committee, the Motorcycling Community Engagement Panel, the Professional Boxing and Combat Sports Board, the Young Farmers Advisory Council, the Public Records Advisory Council, the Sheep and Goat Compensation Advisory Committee, the Sheep and Goat Identification Advisory Committee and the Victorian Ovine Johne’s Disease Advisory Committee.

Abolishing all would probably have no effect on life south of the Murray River, a place where the private sector is plundered to pay for the state.